The EU's decision in December on Turkey's bid for membership will have dramatic effects on the country's economic development. But even if the formal accession process begins, major reforms will still have to be undertaken.

Russia's economy is roaring up the growth curve but dependence on oil revenues, insufficient diversification into other activities and a growing gap between the well-off and the poor give cause for concern.

New approaches to instilling high standards have fed into this year's Euromoney corporate governance survey. Initiatives include activist fund managers taking on mandates to advise other investment groups and the incorporation of governance criteria into bond ratings.

Emilio Botín knew that launching a frontal assault on the UK banking market was never going to be a bed of roses. But the 70-year-old chairman of Grupo Santander, Spain's largest bank, and his team were knocked for six by the furore that was unleashed in response to their £8 billion-plus bid for Abbey, the sick man of British banking.

It's late on a Thursday night and the party cognoscenti are headed for one of Asia's slickest nightspots. From the exterior, f.bar, a bunker-like building with an unpromising squat black façade is guarded by serious-looking security personnel clad head to toe in matching black.

Following a period of sustained economic growth, the Caribbean is faced with a new challenge. Recent developments in international legislation might reduce capital inflows and put more pressure on the region's financial sector.

Bulgaria cleared an important hurdle when it finally approved the sale of mobile phone company BTC to a consortium led by Advent International in February, in one of the region's largest leveraged buy-outs. Financing for the deal finally closed in June. Gyuri Karady of Baring Private Equity Partners says: ?It tested the legal framework in Bulgaria, and it looks like the rule of law prevailed, which is a triumph for Bulgaria.? Progress on the deal was one of the factors that helped the country obtain an investment-grade rating later in the year.

No-one disputes that China's growth rate needed reining in. While investors worry over the possible consequences of a sharp slowdown, most economists believe that, contrary to global historical precedent, the Chinese authorities might have pulled off the trick of a relatively painless cool-down. But serious structural flaws in the economy remain and make China a perilous place to invest.

First Wit dumped its attempt to build a retail platform. Next, it dumped its name, and moved out of its Silicon Alley headquarters in New York to Connecticut. Then last year Charles Schwab Capital Markets bought it. At least Wit, by then Soundview, the name of the boutique it bought in 1999, was joining a like-minded firm with ambitions to change how markets work.

Nordea has become the first bank anywhere to completely outsource its company equity research. It is unlikely to be the last. The pan-Nordic bank is to cease its own coverage of stocks in the Nordic region and will instead buy research on 200 regional stocks, including buy, sell and hold recommendations, from Standard & Poor's. This follows a similar deal with S&P last year in which Nordea outsourced all its US, European and Asian company equity research coverage to the US group.

German savings banks are using credit default swaps to reduce their credit risk concentration for the first time.

Analysts are growing increasingly concerned about rising problem loans advanced to SMEs by Korean banks. The banks' track record inspires little confidence. They lent unwisely to the conglomerates in the late 1990s and then hit problems with consumer credit cards. Have the Korean banks learnt their lesson or is a third bad debt crisis looming?

You're a populist left-wing politician in South America. Your country's elite doesn't like you, and Wall Street is scathing. Your reputation could do with a bit of help. What do you do? Why, take out an advertisement in the New York press, of course. The trend started in July, when an advert appeared in the New York Times. "Argentina," it blared: "A responsible country, a responsible proposal". A list of the great and the good followed, attesting to Argentina's "sincere and realistic proposal to creditors" (see Argentina's creditors brace for lowball offer). U2's Bono, Mikhail Gorbachev and actors Emma Thompson and Viggo Mortensen were prominent.

www.breakingviews.com

Wait long enough and anything comes back into fashion. Even flares. Now it's high-yield cash collateralized bonds, or CDOs.

A slowdown in the growth of China's asset pool is not deterring new entrants among fund managers.

South Africa has built stable macroeconomic foundations since the overthrow of apartheid but its potential as a regional leader is still hampered by corporate rigidities, untapped talent reflected in high unemployment, an Aids epidemic and a failure to attract inward investment.

There has been an unseasonal tension on some of Spain's more exclusive beaches over the past month. August is usually a time for the great and the good of industry to leave the stresses of the cities behind them and unwind by the sea. But for the chairmen of some of the biggest companies, the holidays were spoiled by the knowledge that in the autumn they will be fighting for their jobs.

If your competitors are beating you to the most lucrative deals, it could be they're better at pressing the flesh. Wooing potential clients over drinks or dinner is as much a part of a banker's job as making formal pitches.

www.breakingviews.com

Citigroup's trading on European government bond platform MTS on August 2 has provoked a lot of hyperbole. Citigroup sold e11 billion of European government bonds on MTS and bought e4 billion back a few minutes later at a lower price, making a profit and causing losses at other primary dealers. According to one financial newspaper, Citigroup has "systematically targeted other market makers' mandatory price quotes", which has "shocked rivals". Consequently, the eurozone government bond market has been "thrown into turmoil" and apparently national debt agencies have been forced into a period of "intense soul searching".

Germany breached the EU's budget deficit limit of 3% of GDP over the first six months of this year and will almost certainly break the terms of the European stability pact that underpins the euro for the third year in a row. In fact, the government managed to run a 4% budget deficit over the first half of this year, slightly higher than the 3.9% for the end of 2003, federal statistics office Destatis revealed last month.

To date, securitization in eastern Europe has been a very occasional affair. Turkey has seen a few future-flow transactions, Hungary has a relatively developed domestic mortgage bond market, but you can count the number of other transactions on the fingers of two hands. However, the market should pick up this year.

European and US equity markets have mirrored each other for years but macro trends could force a decoupling over the next two years. ABN Amro strategists see several factors paving the way for this. The first is that productivity growth in the US and Europe has passed an inflection point. The US has experienced two years of strong productivity growth, but the rate is unlikely to be sustainable. European productivity still has room for improvement.

Investors ask tough questions these days about companies' ability to honour their commitments. After all, no-one wants to fall victim to the next corporate scandal. But Toys “R” Us shareholders and bondholders are safe, aren't they? Surely official “spokesanimal” Geoffrey the Giraffe and chums won't let them down.

By Camilla Palladino

The mini bank crisis Russians faced in the summer has underscored the urgent need for bank sector reform and the creation of a system that can respond to the credit needs of businesses and individuals.

Deflation is on the way, summoning up a long and dreary financial winter. But it should be preceded by a burst of autumn sunshine

Having been heavily overweight on Russia last year, many emerging-market equity investors are now scaling back their positions. Some investors are making a fundamental reassessment of Russian equity risk.

The new coalition government led by Indian prime minister Manmohan Singh will kick off privatization sales with a billion-dollar initial public offering in September.